How Entergy spent $1.3 million to polish its reputation, script support and monitor opposition to its new power plant

16th July 2018   ·   0 Comments

By Michael Stein and Charles Maldonado
The Lens

The actors who delivered soliloquies on behalf of a new power plant in eastern New Orleans were just the closing act.

Starting in 2016, Entergy spent at least $1.3 million to burnish its reputation, including about $530,000 directly tied to the plant, according to documents reviewed by The Lens.

For up to $175 an hour, consultants crafted messaging, drafted letters of support from community members, scripted what people should say at meetings, tracked media coverage and monitored environmental and neighborhood opponents.

That was separate from the $55,000 Entergy racked up for an astroturfing campaign in which people were paid to attend public meetings and deliver pre-written speeches on behalf of the power plant.

On its face, Entergy’s application to build the plant was a technical matter, involving projections of electricity demand and intricate details about the power grid.

The company’s approach, however, resembled a political campaign. Consultants called environmental groups “the opposition” and gathered information that could be used against them.

Targets included the Deep South Center for Environmental Justice, the Alliance for Affordable Energy and the community activists of Justice & Beyond. Contractors attended their meetings, tracked their messaging and wrote up reports for Entergy executives.

“We knew they were up to shenanigans,” said Pat Bryant, one of the leaders of Justice & Beyond. “They did more than monitor us.”

In late March or early April, four or five people, including one who has argued for the plant, disrupted a Justice & Beyond meeting and services at his church, Bryant said.

The group moved its meetings to another church. The same people threatened to interfere with a meeting in June, Bryant said, so the meeting was canceled.

“All our members were in agreement that the disruptions were Entergy-inspired,” he said. “We can’t say if they were Entergy-paid, but we knew they were inspired.”

Entergy declined to respond to his allegations.

The utility also enlisted people with political connections. A nonprofit run by Councilwoman Cyndi Nguyen was on the payroll. So were two top advisers to LaToya Cantrell’s mayoral campaign, Bill Rouselle and Bob Tucker.

Rouselle’s company Bright Moments received $336,583, according to invoices. That includes at least $166,800 in work done by The Ehrhardt Group, one of the city’s most prominent public-relations firms.

Tucker’s public relations firm Green Pastures Unlimited received $95,240.

Utility companies routinely carry out PR campaigns when they have a matter before regulators, said Jay Hakes, a former head of the U.S. Energy Information Administration. But this one was unusual.

“In the years I’ve followed electric utilities, I’ve never seen anything quite this intense in terms of trying to mobilize public opinion,” he said. “They crossed the line more than I have observed elsewhere.”

The details of Entergy’s campaign are spelled out in documents it turned over last month to the city council, which is investigating the astroturfing.

At the time, The Lens and other media outlets reported on what those documents revealed about the astroturfing scheme. As The Lens reported in May, people were paid between $60 and $200 to attend meetings and speak on behalf of the plant.

Entergy admitted it hired a company to recruit supporters, but said it didn’t know they would be paid. Documents turned over to the city council, however, show Entergy officials were intimately involved in the effort to turn out supporters, heard allegations that those supporters were paid, and discussed how to respond.

The documents also include hundreds of pages of contracts and invoices. They show the scope of Entergy’s effort to convince city regulators, through its customers and local nonprofit organizations, why the new power plant was imperative.

Of the $1.3 million outlined in the invoices, bills directly tied to the power plant total about $580,000, including $55,000 for the astroturfing. (Entergy didn’t end up paying the entire amount.) The other portion is a $750,000 “Reputation Management” campaign.

University of New Orleans political science professor Ed Chervenak said he’s not surprised at the extent of Entergy’s efforts.

“Anytime you’re going to lobby a legislative body like the city council, you want to have everything in order,” Chervenak said. “You want to go to the professionals. They know the city. They know how to run a campaign. They know how to approach council members.”

Hakes, who spoke out against the plant earlier this year, said the effort was misguided. “This should be based on the technical merits,” he said.

A lot was on the line. Entergy New Orleans’ deal with the city allows the company to bill customers for its capital investments, plus a profit of about 11 percent. Every month for 30 years, customers will pay a bit toward the $210 million plant, as well as roughly $23 million in profit.

Entergy’s public messaging — reliable, local energy; more jobs — remained constant even as the reasons it presented to the city council shifted. When the company first applied to build the plant, it said it was necessary to meet peak energy demand on the hottest days of the year.

When Entergy’s demand projections didn’t bear that out, the company offered a new argument: The plant would mitigate an unlikely transmission issue that could cause cascading blackouts in New Orleans.

That rationale was barely mentioned in the company’s first application. “I don’t remember it coming up at all until the second application,” said former City Councilwoman Susan Guidry.

Entergy Leverages Its Charitable Contributions

On July 25, Bright Moments billed Entergy for drafting “remarks of support for the [power plant] on behalf of the N.O. Council on Aging.”

The next day, a Council on Aging employee spoke in favor of the plant at a public hearing. “I hope you will consider what this power station will represent for the elderly community,” she said.

Two days later, Entergy announced it had recently given the group $308,323.

Howard Rodgers, executive director of the organization, spoke in favor of the power plant at council meetings at least twice.

In an interview, Rodgers said Entergy has supported the Council on Aging for years, and his remarks were not directly connected to the donation.

Over two years, Entergy has donated more than $10 million to more than 275 organizations, Emily Parenteau, director of corporate and executive communications, told The Lens.

“The assertion that Entergy and its employees would support charitable organizations for any reason other than the causes these organizations serve is offensive,” she wrote.

But the documents show that leveraging those donations was, in fact, part of the utility’s public relations strategy.

In late 2016, several months after Entergy applied to build the plant, it paid The Ramey Agency, a local advertising firm, $750,000 for a “Reputation Management” campaign.

The goal was to “quickly raise awareness of [Entergy New Orleans’] investments in the New Orleans area.” Ramey would “evangelize” those investments and “leverage [corporate social responsibility] nonprofit partnerships.”

In part, the campaign aimed to call attention to $1 million in workforce development grants Entergy had awarded earlier that year. Recipients included the state economic development agency and Delgado Community College.

In May 2017, the company publicized $3 million it had given at the end of the prior year to nearly 60 groups.

Entergy also called on its nonprofit beneficiaries to speak out on behalf of the power plant.

People representing at least 19 organizations funded by Entergy spoke at two key Utility Committee meetings, voicing support for the plant and praising Entergy’s corporate citizenship.

“Thank you to Charles Rice for inviting me to speak on behalf of Entergy’s longstanding commitment to our community,” said the CEO of United Way of Southeast Louisiana, Michael Williamson, at a public hearing in October.

“Last Thursday, Entergy dedicated another $1 million to the new Prosperity Center and its mission to lift individuals and families out of poverty and into financial stability,” he continued, wearing one of the orange shirts worn by the actors.

Entergy was willing to use the stick as well as the carrot. In March, Entergy rescinded its $20,000 sponsorship of local radio station WBOK for its critical coverage of the gas plant.

“That was a huge shot across the bow,” Hakes said.

He called it “a message to anyone who receives a charitable contribution from Entergy that they’re not allowed to publicize divergent views.”

Consultants Were Voices Of The Supporters And Had Eyes On The Opponents

In November, the executive director of the Alliance for Affordable Energy, Logan Atkinson Burke, emailed someone who had attended a couple of her group’s meetings about the potential health effects of the plant.

She noted that the woman was employed by The Ehrhardt Group, one of the firms working for Entergy.

“I can only assume your firm has been hired to consult on outreach for the utility regarding the proposal,” Burke wrote. “While you are certainly welcome to attend, we think it is fair that we understand who is in the room and their professional intentions.”

The Ehrhardt employee emailed back, saying she worked “alongside Entergy for community outreach. I wanted to attend these informational meetings to ensure we are understanding all sides, including your organization and the public.”

Ehrhardt billed Entergy $75 for a half-hour of work to review and respond to Burke’s email.

Malcolm Ehrhardt said his employees handled those meetings appropriately. “They said who they were, they gave their names, they gave the company they worked for, and then when Logan inquired for additional information on who they worked on behalf of, they told the truth.

“It sounds like the definition of transparency to me,” he said.

Judging by the bills, opposition monitoring was a big part of the job.

In October, days after developer Marcel Wisznia wrote an op-ed criticizing the plant in New Orleans CityBusiness, Entergy’s consultants took note of a potentially damaging article about dozens of short-term rentals in his buildings. “Sent to client for review,” reads an invoice.

On March 8, the city council was set to take its final vote on the plant. A few days before, organizers for Justice & Beyond sent an email to supporters with the subject line, “ENTERGY CORRUPTS POLITICS.” It invited people to attend a meeting that evening to talk about the group’s opposition to the plant.

According to a March invoice, a Bright Moments employee attended the meeting, took notes and sent them to Entergy.

Attendees at Justice & Beyond meetings are typically asked to introduce themselves. Bryant said he doesn’t recall anyone saying he or she was with Entergy or one of its contractors.

“If they had … they might have been asked out,” he said.

“This is the first time I’m aware of a public utility hiding its monitoring of communities that want to learn about the gas plant,” said Monique Harden, assistant director of law and policy with the Deep South Center for Environmental Justice.

“Being a target of the company is outrageous,” she said. “At what point is City Council going to deal with the real unethical, intrusive practices of this company?”

Rouselle said Bright Moments didn’t do anything untoward. “We went to meetings that were open to the public and made an effort to be able to understand what their arguments were for and against the plant,” he said, “so that we would be in a better position to provide information on how to either offset those arguments or agree with them.”

In some cases, he said, he “may have helped modify Entergy’s position” based on what opponents said.

“I think some of the things they are saying are very valid and are real concerns that people are having,” Rouselle said.

Consultants provided a voice to their supporters, too. “Assisted in developing scripts for speakers for the City Council Utility Meeting” says one Bright Moments invoice from July 2016.

They billed for drafting a “clergy letter” and letters and remarks for “a local business owner,” a “nonprofit supporter,” a “stakeholder,” and people who appear to be prominent New Orleanians.

“The astroturfing, if it wasn’t illegal, it was certainly unethical,” Chervenak said. “But in terms of the letter-writing, a lot of groups will basically have a template they’ll have their members use to write to legislators. There’s really nothing unethical about that.”

Meanwhile, Entergy held community meetings of its own “to counter the misinformation disseminated by opponents of progress,” as Bright Moments’ contract put it.

Tucker advised Entergy on these meetings through his company, Green Pastures Unlimited.

He said he made sure Entergy was “hitting on the key features of the plant, particularly the job creating aspect of it and the fact that there were no health hazards.” He helped people “understand the facts as opposed to a lot of stuff that was not factual being peddled by the other side.”

The Media Blitz

And then there was the media campaign.

Consultants lobbied practically every news outlet in New Orleans. They created presentations to win over editorial boards, prepared Entergy New Orleans CEO Charles Rice Jr. for interviews, and wrote op-eds for him.

Bright Moments and Ehrhardt set up editorial board meetings and interviews with The Advocate, Gambit, The New Orleans Tribune, NOLA.com/The Times-Picayune, The Louisiana Weekly, WWL-TV and WVUE-TV.

In August alone, Entergy was billed about $2,600 for editorial board meetings.

The work appeared to pay off. In December 2016 and again in August, The Advocate’s editorial board endorsed the plant.

“We were lobbied on the power plant by both sides,” Advocate Editor Peter Kovacs said. “Both sides are very smart, both sides made their case, and we took a position.”

In January, Bright Moments set up a meeting with Gambit’s editorial board. A month later, Gambit editorialized in favor of the plant.

Clancy DuBos, Gambit’s political editor, said he spent more time talking with opponents than he did with Entergy. But he sided with the utility.

“The astroturfing is awful — and needless, and flat-out dumb — but frankly I doubt the council voted 6-1 in favor of the new plant based on the number of orange T-shirts in the audience,” he wrote in an email. “I’m convinced, based on my own conversations with council members, that [the consultant’s] recommendation swayed them more than anything else.”

NOLA.com/The Times-Picayune, The New Orleans Tribune and The Louisiana Weekly don’t appear to have published editorials or columns weighing in on the power plant. The Tribune wrote a positive story after Bright Moments set up an interview and a meeting with its editorial board.

In January, freezing temperatures prompted Entergy to ask customers to limit their energy usage. Entergy’s consultants saw it as an opportunity. They wrote an op-ed on behalf of Rice entitled, “Recent weather, blackout threat underscore need for new power plant.”

Consultants then wrote supportive letters to the editor to back up Rice’s argument.

There are many references in the invoices to letters being written to send to The Advocate. But The Lens didn’t find any that were published supporting Rice’s column.

“We draft letters,” Ehrhart said. “And there are discussions and meetings about whether those things could be said, should be said, and who would send them. Sometimes people offer to send them.”

Kovacs said The Advocate receives 20 to 40 letters to the editor every day and doesn’t publish most of them. “We want our letters to be spontaneous statements of opinion by readers and citizens,” he said, “not part of a churned-up campaign.”

Will Customers Pay For The PR Campaign?

Harden, with the Deep South Center for Environmental Justice, said the documents show “that what Entergy is really after is not a better energy service for New Orleans. What they’re really interested in is getting that return on equity from the construction of the gas plant.”

Entergy can also charge customers for its expenses. Political advertising and lobbying are generally not recoverable, but it’s unclear whether the consultants’ bills were passed on to customers.

“Costs related to the reputation management campaign for the New Orleans Power Station are not included in customer rates,” Parenteau said. She didn’t respond to follow-up questions asking if that includes the $530,000 spent to build support for the plant.

By the end of July, Entergy has to file a rate case — the beginning of a months-long, formal process during which the city council will decide how much the utility can charge customers.

Entergy has not gone through a rate case in a decade. This one may illuminate whether New Orleans customers paid $530,000 to convince themselves they needed a new power plant.

This article originally published in the July 16, 2018 print edition of The Louisiana Weekly newspaper.